No Private Losses And EFSF * 2
I would like to start mine, mine, mine, buy ’em, take em, mine, mine, mine, lift the offer, mine, mine, and get me some more desk at a bank. If I understand the concept correctly, I could buy sovereign debt and be “promised” that it will never default. And if I’m a bank, I can […]
The End Of Act I
So Act I has played out and to be honest, has left the audience feeling a bit underwhelmed. While no one expected it to be easy, a couple of additional scenes have not helped the mood. The “squeeze” effect is over. On Friday we really liked the possible squeeze names – those that had been […]
The Fed – Independence, Yes, But Accountability And Limits
At this point it is clear that there is no single person in America, and possibly the planet who can influence markets as much as the Chairman of the Federal Reserve Board. The president may have more overall power (possibly) but in terms of moving markets for weeks at a time, that power primarily belongs […]
So Why Did They Forget To Put EFSF On Watch Yesterday?
My guess is that EFSF is rated by the structured credit group and not the sovereign debt group (imagine the fights over fees on that potential behemoth). So when the press leaked the downgrades, the sovereign group rushed to get the details out, but the structured people in Europe had already gone home, so couldn’t […]
S&P Statement On EFSF – Oct 28th
http://www.zerohedge.com/news/sp-issues-statement-efsf-says-almost-certain-european-governments-would-support-cdo That is the statement from S&P from October 28th. They made it clear that EFSF depends on the ratings of the countries. Guess they forgot that when they sent out the release last night. Is EIB at risk? They have a very different structure than EFSF but not sure they would be immune from the downgrades. EIB […]
The Show Must Go On
It looked like S&P had gone off script. They slapped a negative watch on any euro country that didn’t have it already. They even came out with details about which countries faced 1 notch and which faced 2 notches. I’m glad I didn’t have this information on Friday as I wouldn’t have bet we would […]
What The TF!
S&P AAA SDR IMF ECB Fed CDS The fact that the global financial system hinges on these 7 sets of 3 letters is appalling and amazing. If GS is the best and brightest the rating agencies are close to the opposite, yet somehow regulators let them set a ceiling on bank capital and now […]
There Must Be Some Great Phone Calls Going On Right Now!
With the “negative watch” rumor now leaked there have to be a lot of ugly phone calls occurring right now! How it leaked is interesting enough but the Merkozy must be going ballistic right now as I can’t see how this helps them no matter the outcome of this week’s decisions. Will they really go […]
All The World’s A Stage
I can’t help but feel that we are watching a performance this week. It feels like the actions, the meetings, and the statements are all very scripted. It seems reasonably clear which ending they are going for, but many of their actions also fit the “alternative” ending so it remains imperative to be cautious. Roles […]
Mortgage QE?
There has been more and more speculation that the Fed is getting ready to launch a new QE program, this one targeting residential mortgages. With the data coming in better than expected, stocks back up, and Plosser and Bullard both chiming in that improving data would make them hesitate or question the need for more […]